Just Ask: The Secrets to Reclaiming Credit Card Charges

23-AprilWith even a single late payment significantly increasing your credit card bill, taking some steps to reclaim your credit card charges is a great idea. A recent guide in This Is Money covered the basics of reclaiming credit card charges and fees using a basic knowledge of the law and some friendly customer service outreach.

If you’ve been hit with hefty credit card charges before, these simple tips can make it far easier to reclaim them and reduce your monthly bill. Start by understanding the basics of the rules that credit card providers are required to follow. After a ruling by the Office of Fair Trading, banks can only charge a suitable amount to customers.

This means that fees for late payments can’t be arbitrarily decided by the bank; they need to actually reflect the costs incurred by your card issuer. Due to the 2006 rule, most banks lowered their average credit card charge from a staggering £35 down to just £12 per instance.

The key to reclaiming charges is spotting them early. Most banks include charges in the list of transactions on your monthly statement instead of listing them in another section. Check your statement in detail and follow up on charges that you think are not justified.

Reach out to your credit card company – not your bank – and ask for leniency on the charge. If you have a clean credit history and no past charges, most card companies will reverse the charge with few questions asked. Generally, credit card companies are more lenient when it comes to reversing charges and fees than banks.

While most charges can be reversed with a quick phone call, writing a letter to your credit card company is a good way to get large charges reversed. Remember that the competition between credit card companies is immense, and many companies will happily reverse a charge in order to retain your business.

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Regulator: Credit Card Industry Encourages People to Go Into Debt

04-AprilThe Financial Conduct Authority (FCA), Britain’s leading financial regulator, claims that credit card companies are encouraging consumers to take on ‘excessive’ levels of debt through attractive offers tied to high-interest, high-fee credit cards.

The watchdog plans to investigate the conduct of the country’s £150 billion credit card market. It was recently revealed that over nine million consumers are trapped in a debt cycle, using high-interest credit cards for the majority of their spending.

New offerings from credit card companies with high fees and minimal restrictions have been dubbed ‘payday loans with plastic’. Regulators fear that, as payday loans are restricted via advertising bans and limitations, the credit card industry will start to target the same vulnerable consumers.

According to the FCA, more than 18 per cent of adults in the UK are vulnerable due to their levels of consumer debt. Of the nine million people with serious credit card debt, more than one million only manage to make the minimum monthly payment on their balance.

The FCA investigation will look at the ‘culture, ethics, and business models’ of some of the country’s top lenders, according to FCA chief executive Martin Wheatley. The regulatory authority previously investigated over 50,000 payday loan providers and debt management firms.

Key factors of the investigation will include the amount of information disclosed by lenders to borrowers, such as the cost of credit and the fees involved in using credit cards to make purchases. The investigation will also observe how banks deal with borrowers who fail to make timely payments on their account balances.

Consumer rights campaigners believe that the probe is long overdue, and that credit card providers have avoided the strict regulations placed on payday lenders for too long. Which? executive director Richard Lloyd claimed that many credit cards were designed primarily to ‘catch customers out.’

UK consumers possess approximately 56 million credit cards and spend over £150 billion using their cards every year. An estimated 8.4 million households have little or no savings, according to the Financial Conduct Authority.

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South Korean Regulators Punish Credit Card Companies

February-17After more than 20 million people had their credit card information stolen and sold to deceptive marketing firms, South Koreans have plenty of reasons to be upset with their credit card providers.

The South Korean government is equally appalled, and this week it decided to fine the country’s three largest credit card firms 6 million won (£3,371) each. The fines may be relatively insignificant financially, but they come with a costly penalty for the credit card firms – all are banned from issuing new cards for three months.

More than 40% of South Korea’s credit card users had their data stolen during an attack on the Korean Credit Bureau’s computer system. A contractor working with the credit ratings agency reportedly stole the information by saving account details to a USB stick during a two-month job with the company last year.

The data was subsequently sold to credit card fraudsters and marketing firms, who many believe are using the credit card numbers and account names to sign people up for unwanted services. The theft and subsequent fraud was caused by the three firms “neglecting their legal duties of preventing leakage of customer information.”

Credit cards are big business in South Korea, which has one of the highest rates of usage in Asia. Many adults in South Korea own several cards and switch between credit card providers based on special offers and rewards. In the last three years, however, credit card records have been frequently targeted in cyber attacks.

The recent security breach at the Korea Credit Bureau comes just one year after two ackers stole more than 8.7 million credit card records from KT Mobile. Just one year earlier, more than 35 million accounts were stolen from South Korean online social network Cyworld.

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Pensioners Find it Hard to Quality for Credit Cards

February-13Pensioners are struggling to quality for credit cards. In a recent letter to the Sunday Express, a pensioner and Lloyds customer for almost 60 years reported that she her application for a credit card had been turned down due to her age.

From the original letter:

“A TSB and Lloyds customer since she was 17, Olive had a bank card but swapped it for an M&S store card for a couple of years. ‘Now I want a credit card to use on the odd occasion I buy on the Internet,’ she says.

I have contacted Saga, TSB and some other banks and have been told that I am too old, that the cut-off age is 74 or that my income, about £6,200 a year, is not enough.”

According to finance website Moneyfacts.co.uk, there are no fixed cut-off rules about credit cards. Cards are issued based on factors such as income, age and ownership of your own home.

Interestingly, older customers are deemed “more risky” at many banks. As many old customers are on a pension, they often do not qualify for a credit card due to income requirements used by many banks.

Saga, for example, requires new customers to have an income of at least £12,000 in order to qualify for a credit card. While TSB doesn’t automatically turn down older applicants, it does refer customers 75 and up to a central lending unit in order to assess their income and reliability.

Moneyfacts.co.uk recommends that older customers looking to acquire their first credit card instead look at “credit repair” cards. These cards offer a smaller credit limit and are primarily used by customers aiming to improve an otherwise poor credit score.

Prepaid credit cards – in which an account balance is loaded onto the card prior to use – are also an option for pensioners in need of a credit card for use online. These cards are widely available and have far less restrictive minimum qualifications.

Like credit cards, they offer protection form theft and fraud, making them a fantastic option for pensioners and older customers looking for a reliable credit card to use for online shopping.

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London Flats Available on 0.8% Credit Card Deposit

February-04Interested in buying a home for as little as £2,00? New London apartments are being marketed to potential buyers using a new credit card payment scheme in which customers can make a £2,000 initial payment using their credit card.

The innovative financing deal has attracted a huge amount of feedback from credit experts and consumers alike. But not all of the feedback has been positive – many believe that the tiny deposit and credit card-style interest spell a return to the days of easy credit and unsustainable borrowing.

The apartments are being developed by Galliard. The property company notes that homebuyers won’t be able to secure the apartments with just a £2,000 deposit – in the 20 days following their initial deposit, they will also need to secure £25,000 – a ten percent deposit on the apartment’s value.

Galliard sales director David Galman said that the controversial financing scheme will “enable ordinary Londoners to get on the housing ladder.” Credit charities are less enthusiastic about the scheme, with many claiming that the small deposit is a deceptive marketing tactic designed to trap consumers in high-interest loans.

A Money Advice Trust spokesman claims that the many buyers would be “seduced by the small deposit” and trapped in a long-term mortgage. He continued to state that lenders should be “extremely careful” with their affordability assessments in situations where mortgages are available with “little or no deposit”.

The cost of London housing has continually increased over the last two years. Ernst & Young recently reported that, if current trends continue, the average house price in London would reach £600,000 by 2018. Prices have risen as credit becomes more available to homebuyers that were previously “locked out” of the market.

Unless this rise in credit availability is accompanied by an increased in supply, the market could become unsustainably overpriced.

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Customer Credit Card Data Exposed in Hotel Security Breach

February-03The company that maintains hotels for Hilton, Sheraton, Marriott and Westin was hit by a serious data beach that exposed thousands of hotel guests’ credit card details, a report from computer security expert Brian Krebs claims.

Financial services industry security experts have spotted fraudulent transactions on the activity reports of hundreds of credit cards used to check in to Marriott hotels, a report from Krebs claims. The hotels affected by the breach are located in Chicago, Denver, Los Angeles, Austin, Tampa and Louisville, the security expert states.

The 15 hotels affected by the breach are all managed by White Lodging – a company that works with leading hotel brans across the United States. The security breach is believed to have occurred from March 20 until December 16 and been targeted at guests hat used their credit cards in hotel bars and restaurants.

Hotels affected by the security breach are working with security experts to resolve the situation and prevent any further fraudulent transactions from occurring. The security breaches targeted payment systems that the hotels do not directly control, creating difficulties in alerting customers to the potential credit card fraud.

The White Lodging security breach is the latest to have been discovered in a string of similar computer crimes. Well-known retailer Target was affected by a massive data breach in which over 110 million customers had their private data – including credit and debit card information – hacked into and stolen.

Credit card information from Target customers continues to appear for sale online on hacking forums. High-end retail store Neiman Marcus was also affected by major hacking attempts, with criminals stealing the credit card details of over 1 million of its customers in a serious breach of security.

Computer security experts believe that the hackers exploited a vulnerability in the technology used to encrypt users’ credit card information. Data was stolen during the brief period in which information was unencrypted, security experts claim.

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Holidays Could Take Up to 10 Years to Pay Off, Survey Shows

February-01A new survey by TotallyMoney.com has found that holiday spenders in the UK will put 8% more of their bills on their credit card, racking up an astounding £9 billion collectively. The increase means that over a quarter of all holiday spending will now be billed to credit cards.

Worryingly, 11% of the people that take international holidays this year will only make the minimum repayments on their credit card balances, meaning that even “cheap” trips to destinations such as Tenerife could end up costing almost twice as much as they should and take more than 10 years to pay off.

Credit card usage has soared in the UK as families and individuals struggle to deal with rising living costs. An increasing number of people are putting almost all of their leisure spending – holidays and consumer shopping – on credit cards in an effort to delay repayments.

While a short trip to Tenerife could cost as little as £1,200, credit card interest and long repayment periods can increase the cost to as much as £2,100. Travel further from Britain and the cost increases even further – a £3,561 trip to New York City is an incredible £3,000 more expensive if you pay it off over 16 years.

Consumers are well aware of the dangers of excessive credit card spending, but an alarmingly large percentage of individuals and families are nonetheless opting to buy costly international holidays using their credit cards. Twice-bankrupt Kerry Katona visited Tenerife in January – signalling, some experts believe, that holidays aren’t an unaffordable luxury, even for the financially distressed.

While the smart choice is to avoid international travel and instead holiday at home in the UK, many consumers are choosing to avoid thinking about the repercussions of credit card use and travel internationally anyway. Financial experts are worried that dependence on credit cards could lead to serious consumer debt issues.

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$9.84 Credit Card Scam Targeting American Account Holders

january-29A new credit card scam is costing American consumers very little, but generating a multi-million dollar fortune for hackers. Dubbed the “$9.84 scam”, the scam targets American credit card users with a single payment for $9.84 – a sum that the scam’s perpetrators likely believe is small enough not to arouse suspicion.

Computer security experts believe that the scam is unrelated to the recent security breaches at retailers like Target and Neiman Marcus, but warn that it could become more commonplace as the data from these hacking attacks becomes available on the underground online forums used by credit card fraudsters.

Brian Krebs, of krebsonsecurity.com, has been monitoring the scam and tracking its development. He believes that the scam has been occurring since long before Target and other retailers were hacked, and that the fraudulent activity peaked during the Christmas holidays.

During the holiday period, consumers are less likely to notice small changes to their credit cards, and less likely to report them as suspicious. Krebs warns consumers to cancel their credit cards if they notice charges for $9.84, which he believes are likely to be suspicious.

American credit card users have been targeted by a variety of similar scams over the past two years. Other fraudsters have used $1 “trial” payments in order to access the credit card accounts of millions of North American consumers, who were then billed for a variety of unrelated subscriptions and services.

Geri Detweiler, the director of consumer education at Credit.com, suggests disputing any fraudulent charges immediately. She claims that scammers frequently make tiny charges to victims’ credit cards immediately after gaining their data, and could make larger charges in the future if their first fraudulent transactions go unnoticed.

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Traveling Abroad? How to Get the Most Out of Your Credit Card

january-12From excessive fees to awful currency conversion rates, using your credit card in a foreign country can be an expensive exercise in frustrating fine print. Luckily, you don’t need to deal with hidden fees and expensive commissions when you use the right credit card during your next holiday.

Understandably, most travellers don’t want to spend their holidays walking around a destination with large amounts of cash. A credit card can be a cost-effective choice, provided – that is – you’re willing to pay attention to the card that you’re using and the merchants you’re using it with.

Credit card experts recommend the Post Office platinum card for keen shoppers that love to travel. This card offers users free transactions on any products purchased in a country other than the UK – a nice deal. Amazingly, free transactions even apply to products purchased online in the UK from an international merchant.

Other good choices include the Halifax Clarity and Lloyds Bank Choice Rewards credit cards, both of which offer fee-free use in any country. Lloyds also has a special Avios cards that allows you to upgrade your travel tickets to business class once you’ve spent over £7,000 in one year.

Metro Bank has a great offer for travellers spending most of their time in Europe. All of their cards are completely fee-free, allowing you to spend as much as you like on holiday without worrying about transaction fees. From March 2014, there will be an additional fee charged to transactions outside Europe and the UK.

Worried about crime? Terrified of high fees? Using a credit card on your holiday is a great way to protect yourself from petty theft, avoid huge fees and commissions, and get far more out of your holiday. Just don’t forget a few spare euros for buying gifts, local products, and charming souvenirs.

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Save Money With These Household Finance Tips

december-20With the New Year on the way, now is the perfect time to make financial resolutions and change your spending habits. The cost of living has increased for many British households over the past year, making changes to spending less of a good habit and, for many people, far more of a necessity.

From credit cards to reused gadgets, these five simple tips can help you make 2014 your most financially successful year so far.

Shop using comparison websites

Save money by comparing prices on everything from groceries to new phones. The hundreds of comparison shopping websites serving the UK market make it easy to save money, whether you’re buying this week’s groceries or a new energy plan.

Use credit cards to your advantage

Credit cards can be a disaster when mismanaged, but are immensely valuable when used properly. Look into reward and cashback credit cards as a way to earn special points and bonuses on your shopping. Spend responsibly and you’ll save money and build a great credit rating at the same time.

Buy generic products and food

Cut down your grocery bill by shopping for generic, own-brand products at the local supermarket or grocery store. Non-branded food often tastes just as good as a more popular brand would, at half – or even less – of the price.

Use public transportation

While public transportation is getting more expensive, it’s still a far more affordable option than travelling by private car. If you live close to work, take the bus or ride a bicycle to save money and help the environment.

Travel domestically this year

Enjoy the holiday experience at home by spending your time within the UK. Many of Britain’s top holiday destinations are easy to access using cheap flights and rail fares that save you the cost of an international holiday.

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